Every year, more and more small businesses pop up. Thanks to them, local economies are stimulated, neighborhoods get job openings, and they contribute to the overall national economy. Small businesses are generally deeply rooted in their local area, always giving back to the economy on top of offering important services. But beyond the obvious economic benefits small businesses bring, there is a lot more to it. Here are some more examples of why these businesses are vital and why we should always support them.
As mentioned before, small businesses are deeply rooted with the local area—and by extension, the local community. They can help the local community by providing the necessary services and economic options, such as tax and job openings. While this has already been mentioned, it cannot be stressed how critical this is. Many communities need certain essential services, such as a laundromat, cafe, and even a small shoe store. When placed in a community or locale that needs them, these “meager” businesses will shine and can give more than what the community is asking for.
Providing Services on a Smaller Scale
Bigger businesses may look like industry leaders and powerhouses, but acquiring services in smaller quantities would be more challenging without smaller businesses. In particular, small businesses contribute to the growth of the industry and the general economy because many of them provide accessible solutions to specific needs. Whereas large manufacturing businesses offer large-scale production sizes and wholesale orders, smaller businesses can accommodate more personalized, lower-quantity orders.
Take, for example, urban fixtures manufacturing and a wedding planner looking for acrylic lamps for giveaways. A bigger manufacturing plant does not find it efficient to manufacture two-digit orders. In contrast, a smaller scale manufacturing plant with a reliable acrylic laser cutter can take in 20 to 100 orders from a singular client. Because of this obvious competition, it’s common for bigger companies to absorb the smaller ones. However, it’s more practical for people to buy from smaller businesses that offer smaller quantities.
Spearheading Innovation and Signaling Trends
By their very nature, smaller businesses have more liberty to make quick changes and adapt to trends. This is all because there’s less red tape to deal with and the business owners themselves are very hands-on with their operations. Business owners can decide to implement or adapt whatever they see fit in an almost instantaneous fashion.
With this freedom comes more leeway for both mistakes and innovations. Many smaller businesses can actually do great with the freedom they have. Social media marketing, viral marketing, and instant adaption to the changes in community and market prices—smaller businesses commonly take these actions regularly. When smaller businesses quickly adapt to the changing times, it’s often a sign that corporations need to follow suit.
Closer to Customers
Another apparent advantage of small businesses is their ability to connect to customers on a more personal level. The ability to speak directly to the customers, get to know them better, and understand their needs more is easily achieved when an owner is right there on site to talk to people personally. This advantage provides invaluable insight into customer needs and can therefore give the business clearer ideas on what and how to improve.
Though this can be an advantage, it isn’t always a win-win situation. A mom-and-pop diner can create loyal customers due to organic relationships that owners make with their diners. However, it can be hard to increase that number. On the other hand, a more popular food chain can maintain good customer flow without necessarily keeping the number of loyal ones.
In line with being able to create closer relationships with customers, small-scale businesses can personalize their interactions and deliver specific services to each client. This is an important factor since the customers of today are becoming more interested in personalized products and services. What small business owners need to learn early on, though, is the ability to remain agile. Businesses need to be able to adjust quickly based on current and future demands.
Of course, this isn’t to say that small businesses are set to take over larger corporations overnight. There are still some shortcomings of many startups that contribute to the downfall of many. One such shortcoming is being adequately informed on legalities. Rules and regulations do get updated, and businesses should always keep track of these changes. In addition to the law, small businesses also need to have a good grasp on their burn rates and runway to avoid financial troubles.